EVFTA to boost green growth in Vietnam

(VEN) - The EU-Vietnam Free Trade Agreement (EVFTA) can boost the termination of trade barriers and the development of conditions favorable for green growth in Vietnam.

The renewable energy sector attracts EU investors in Vietnam

Vietnam and the European Union (EU) are in the final phase of negotiations on a free trade agreement (FTA) which is expected to play a key role in improving trade and investment between the two parties. According to experts, after the EVFTA is adopted, it will promote investment, technological renewal, productivity and production, while at the same time boosting production capacity and competitiveness of domestic enterprises. As a result, green growth will increase.

Trade and investment statistics in recent years also show the EVFTA’s positive impacts on the development of economic relations between the two sides. The EU is currently Vietnam’s second largest client in terms of exports and fifth largest client in terms of imports. After the agreement is concluded, 90 percent of Vietnamese exports to the EU will enjoy the zero percent tax rate. The EVFTA will offer many more opportunities for European trade and investment in Vietnam as a result of the termination of import tariffs on most goods from Europe. The agreement will also give ample opportunities to European investors, particularly those in clean energy and green growth, to enter the Vietnamese market.

EuroCham President Nicola Connolly said that European businesses want that the EVFTA to be rapidly adopted in order for them to increase their investment in Vietnam. In the next five years the EU will earmark about 350 million euro to renew technology and increase productivity and output in a variety of production sectors.

EU green growth investors are currently targeting four major sectors including renewable energy, energy saving, sustainable projects, and water and garbage treatment, which meet Vietnam’s sustainable development orientation.

However, shortcomings exist relating to renewable energy development in Vietnam. For this reason, technology and capital are necessary to enhance the development of renewable energy in Vietnam. According to EuroCham, to attract European investors in green growth in Vietnam, the country needs to put in place attractive trade mechanisms to foster foreign investors. Also according to EuroCham, Vietnam does not have sufficient policies, mechanisms and laws on renewable energy, which would provide an important basis for sustainable and stable energy in the future.

Ho Chi Minh City People’s Committee Deputy Chairman Tat Thanh Cang said that Ho Chi Minh City will provide the best conditions for businesses to renew science and technology and apply environmentally-friendly technology. It will also launch six breakthrough programs to achieve its green growth target by restructuring the economy, reducing traffic congestion, reducing environmental pollution, reforming its administration, improving the quality of human resources, and reducing floods.

In the near future, EuroCham will share its experience and help implement programs and projects to improve conditions to boost green growth in Ho Chi Minh City, Tat Thanh Cang said.